As 2024 is about to come to an end, the development of DeFi (Decentralized Finance) is entering a critical turning point. In the face of high transaction costs, network congestion, and the need for cross-domain innovation, the DeFi ecosystem has undergone profound changes in multiple areas. The following are core insights from experts on trends for 2024 and predictions for 2025:
Dominant trends in DeFi for 2024
1. Deep integration of TradFi and DeFi
Alvin Kan, Chief Operating Officer of Bitget Wallet, pointed out that the combination of traditional finance (TradFi) and DeFi has become a core trend this year. The tokenization of real-world assets (such as bonds and real estate) injects liquidity into DeFi platforms while opening up more channels for investors.
Kan emphasizes that the transparency, high yield, and efficiency of DeFi have become key factors attracting TradFi, and the involvement of institutions has also helped the entire field move from the margins to the mainstream.
2. Accelerated deployment of L2 solutions
The high transaction fees and network congestion on Ethereum provide fertile ground for the development of Layer 2 (L2) scaling solutions. Brecht Devos, co-founder of Taiko Labs, stated that the L2 deployments in 2024 demonstrate the importance of fast, low-cost transactions and decentralized characteristics. Although competing chains like Solana attract users with low fees, experts believe they struggle to compete with Ethereum in terms of decentralization and security.
3. Deep integration of AI and blockchain
The integration of artificial intelligence and blockchain brings new possibilities to DeFi. Projects like FraX Finance announced the development of AI-based autonomous smart contracts and tokenization tools, while AI projects such as ai16z and Truth Terminal have gained widespread attention on social media. This cross-domain innovation not only enhances the application scenarios of DeFi but also triggers an increase in the prices of related tokens.
4. New patterns of DEX and revenue models
Data indicates that DEX (Decentralized Exchange) trading volume on Solana has repeatedly surpassed that on Ethereum. However, Ethereum still maintains its position due to its advantages in decentralization and security. Additionally, the revenue models of protocols such as Uniswap and Aave have gradually taken shape, and in the future, they may even distribute profits to token holders in the form of dividends.
Potential impact of Trump's presidency on DeFi
Experts generally believe that the Trump administration's stance on deregulation may create a more favorable development environment for DeFi:
Clarification of regulations: Jawad Ashraf, CEO of Vanar, pointed out that the U.S. government may clarify in the future whether crypto tokens fall under the category of securities, paving the way for protocol revenue and dividend payments.
Protection of decentralized innovation: John Paller, founder of ETHDenver, emphasized that relaxing regulatory barriers will bring more experimental opportunities to DeFi projects, while also avoiding policies that suppress innovation.
In addition, the potential connection between the Trump family and DeFi projects is also seen as a boost for industry development.
Forecast for DeFi in 2025
1. 'Intent'-driven new paradigm of Web3
Illia Polosukhin, co-founder of NEAR, stated that by 2025, the Web3 field will enter a new phase centered around 'intent.' This will allow users to conduct cross-chain transactions and interactions directly through AI agents, fundamentally changing people's relationship with the internet and blockchain.
2. Continued influx of institutional funds
The launch of spot Bitcoin and Ethereum ETFs marks the official entry of institutions into the deep waters of the crypto market. As TradFi investors gradually accept DeFi tools and concepts, the trend of capital inflow will further accelerate, driving explosive growth in the ecosystem.
3. Further maturation of DeFi revenue models
Ashraf predicts that the legitimization of protocol fee models will create more sustainable returns for token holders. The diversification of income distribution models will attract more TradFi natives to try DeFi investments.
The future of DeFi belongs to cross-innovation and compliance-driven initiatives
The future development of DeFi relies on technological innovation and policy support. Whether it is L2 expansion, AI integration, or collaboration with TradFi, DeFi is responding to market demands with strong adaptability.
2025 will be the next critical cycle for DeFi, which is expected to not only complement traditional financial structures but may also usher in a new wave of decentralized innovation.
What do you think is the most important development direction for DeFi next? Feel free to leave a message and share!
